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Biometric technology is transforming the payments industry for the better

25.09.2017

LONDON, UK (Centus) - Since this decade started, fingerprint technology has rapidly evolved. In more recent years, Apple has applied this to many of its mobile devices. Thanks to the technology giant’s innovation, it is now becoming increasingly difficult to access other people’s smartphones without possessing the fingerprints that match the ones applicable to those devices. The payments industry has been quick to embrace the potential that this technology offers and has developed payment methods that enable consumers to make transactions with someone’s fingerprints.

This technology does come with some disadvantages. Karsten Nohl, chief scientist at Security Research Labs, located in Berlin, said all hackers need is a piece of glass with your fingerprints on, or other objects you may have touched in the past, and they can clone the imprints and access your card.

Earlier this year, Mastercard applied fingerprint technology to replace pins and passwords as their central method of authorising transactions. To them, this technology is safe and secure compared to easily forgotten passwords and forgeable signatures. Considering we live in a time-compressed globe and consumers do not have the time to sign paper receipts or enter pins whilst anxious about whether the person behind can see what their pin number is, placing your thumb on your card to prove who you are seems to be much faster and more convenient. The credit card company refers to this new product as the “Mastercard biometric card.”

Even though these new cards are being tested in South Africa for now, Mastercard intends to roll them out globally by the end of this year. It is anticipated that many banks and other financial institutions may be slow to adopt this biometric card though. Once it becomes obtainable, your bank will inform you that it is available and they will invite you to an enrolment centre to scan your fingers. The card’s EMV chip will store an encrypted digital template of your fingerprints. No one else can be entrusted to use your card with their fingers. You can provide a maximum of two fingerprints. Your card is then able to be used worldwide.

HSBC is one bank that has encouraged the adoption of fingerprint technology to many of its mobile devices. It has been particularly popular in China. With this new method, the consumer blinks into their camera using “the selfie mode”. Their identity is confirmed by matching it to a photo stored on the database. If the selfie matches and they can remember the correct password, they can transfer money. HSBC has played a leading role in the banking industry with biometric technology. Since February 2016, the bank has introduced voice recognition and Touch ID for its 15 million British customers. Facial recognition may also be used for new business clients from September.

Local e-commerce firm Alibaba is allowing its subsidiary, Ant Financial, to introduce a pilot programme that enables consumers to pick up packages at smart courier drop off boxes. This business’s customers can also check their accounts and file taxes by scanning their faces. Alipay can also be used at KFC fast food restaurants.

British supermarkets are embracing this trend. This means consumers can now use just the veins in their fingertips to make payments, which will relieve many people who intend to make quick transactions. The Costcutter store at Brunel University, London, has said that it intends to communicate with other established UK supermarkets to implement hi-tech finger vein scanners at pay points throughout thousands of stores. Infrared is used to scan people’s finger veins and then links this unique biometric map to their bank cards. This would be similar to the way online stores retain cardholder information for future purchases. The benefit behind this payment method is that customers can appear at supermarkets with nothing on them but their own hands and use them to make payments in just three seconds.

Sthaler, the business which created this technology, has dismissed claims that fingerprint recognition can be used to hack into people’s possessions by copying finger prints that have been smeared onto phone screens. They said that many students are already using this system and they expect to have 3,000 of them signed up to using this payment method by November. Other European countries like Poland and Turkey have already launched this system. Vein scanners can also be used to access police buildings and one British bank also authorises payments with this technology.

Sthaler is advertising this product to nightclubs and to gyms to verify membership. Premier League football clubs could use them to monitor whether fans have the correct access to VIP hospitality areas.

Because of the infrared light used to produce a detailed map of the vein pattern in your finger, you must be alive to be able to use this technology. If a criminal chopped someone’s finger off, it would fail.

Karsten Nohl is right to warn customers that they need to be cautious with this payment method. With technology becoming more sophisticated, there could be many ways that criminals could discover new tactics to clone people’s fingerprints. But with many businesses launching schemes that will make it easier for customers to make payments using biometric technology, it appears that the advantages far outweigh the disadvantages. Thousands of students are signing up to fingerprint technology, which demonstrates how popular it is among millennials. That is why using selfies to approve of someone’s identity when they try to enter their online banking apps have become normal for many of them. Whatever problems it may have, biometric technology is here to stay. People do not have the time to worry about remembering pin numbers and decreasing numbers of customers are carrying cash. It would be much easier for most of them to be able to use fingerprints to make fast payments. And the most important quality of biometric technology is that it is the person who is in control every step of the way. Biometrics are the future and they should only be encouraged by financial institutions.

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Matthew Snape is a journalist for Centus UK and specialises in topics relating to the EU and UK economy, politics and payments industry. Matthew is also in the middle of completing the National College for the Training of Journalists qualification.